Olex Corporation’s books disclosed the following data for the calendar year 2007:

Retained earnings at beginning of year

$50,000

Net income for year

70,000

Contingency reserve established at end of year

10,000

Cash dividends paid during year

8,000

What amount should appear on the last line of reconciliation Schedule M-2 of Form 1120?

  1. $102,000
  2. $120,000
  3. $128,000
  4. $138,000